The Emperor’s new low-income housing

Florida and land deals go way back.  Historically, very few investments have been as solid as real estate in Florida.  Now, with the housing market crash that is not as much the case anymore, but there are still great and easy ways to make a ton of money in Florida.

Take Crest Capital, LLC for example. Located in the Tampa area, they offered to build low-income town houses on an 18 acre tract of land. Since the project was dubbed “low income” that means, of course, free government stuff….  So the partners at Crest Capital contacted Anthony Jones, the Director, Pinellas County Community Development Department. Mr. Jones thought this was a great idea and quickly gave Crest $3.4 million.

Speaking of huge tracts of land, I still am amazed that Walt Disney was able to make the land grab he did to build Disney World. That is one huge tract of land. 47 square miles….

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But I digress….

That was 2004 when Mr. Jones approved the $3.4 million. Now, I personally know how slow developers can be.  I know how long it takes for a construction project to to be completed.  Once you have a site, there are geological tests, environmental impact studies, land use permits, land disturbance permits, neighbor disturbance permits, disturbed neighbor permits, and the list goes on.

Random sidetrack.  How long would it take to construct the Pentagon today with all of the regulations and red-tape bureaucrats in the way?  The Pentagon is 6.5 million square feet.  Whereas the average home is 2,000. Funds were released August 14, 1941 and ground breaking was September 11, 1941. It was dedicated January 15, 1943.  Almost 16 months to the day…

Back to our story of how a caring and socially responsible development company, Crest Capital, is “doing the right thing” and building low-income housing for unfortunate Tampa area residents.

So here we are in 2012 and how does the project look? Let’s look at some recent photos….

And…

And…

Awesome.

Nothing.

Nada.

Zip.

In 2011 the Pinellas County’s Division of Inspector General investigated the deal and found that Anthony Jones chose Crest Capital who had “no assets and little to no experience in construction.”

Wow.

Nick Kotaiche of the former Crest Capital (After an exhaustive search I can’t find a website or other information on Crest at this time. And by “exhaustive search” I mean a half dozen Google searches while watching an Epic Rap Battle of History on the YouTubes in another browser window and drinking a cup of coffee) blames the failure on the bad economy.

But it was low income housing…..  There are plenty of government subsidies to pay the rent.  And there are plenty of low income people DUE to the bad economy.  Luckily Crest Capital was able to give Pinellas County and Anthony Jones their money back since the project went bust. Oh wait, they didn’t.  The money is gone.  Forever. Vanished. Never to be seen again.

The Pinellas County Commissioner Nancy Bostock stated that Anthony Jones didn’t properly do his due diligence.  Really?  Let’s role play this initial sales pitch…

Mr. Kotaiche: Anthony, I have a great idea for that 18 acres.  Build low-income housing.

Mr. Jones: Great idea! What do you need.

Mr. Kotaiche: How about $3.4 million to get started.

Mr. Jones: Sure, but I have to ask you a few questions.

Mr.Kotaiche: Shoot.

Mr. Jones: What assets do you have to back this project and how much construction experience does Crest Capital or yourself have?

Mr. Kotaiche: None and none.

Mr. Jones: No big deal.  You’re doing this for the right social reasons, which is the most important thing.  Who do I make the check out to?

And that’s how Crest Capital made $3.4 million in a terrible real estate market. I sure could think of a lot of things I could do with $3.4 million.